Shelby County Home Sales Up 19 Percent in 2012

By Sarah Baker

Shelby County had the most home sales recorded in 2012 since 2008 when the housing market started drastically declining.

There were 14,946 home sales last year, up 19 percent from 12,600 unit sales during 2011, according to real estate information company Chandler Reports, www.chandlerreports.com. And industry professionals say the outlook for 2013 is continued modest improvement.

Regina Hubbard of ERA Legacy and 2013 president of the Memphis Area Association of Realtors said she’s noticed consumers feeling more bullish about the economy than in years past, which is poised to favorably impact residential real estate.

“Even though we almost fell off the fiscal cliff, people still feel more upbeat,” Hubbard said. “The unemployment rate has continued to decline, and as far as the housing industry is concerned, I think we are near or close to bottom. But everything will be at a slower pace.”

“The market is coming back, it’s just not coming back as fast as I think people want it to,” Bell-Warren said. “A lot of people go online and read that the market is bad. It is bad, but there are still some good things out there.”

In addition to units sold, pricing posted increases from 2011 as well. Home sales averaged $123,873 and totaled $1.85 billion in 2012, compared to $121,618 and $1.5 billion, respectively, in 2011.

Fifty-seven percent of home sales in Shelby County totaled $99,999 or less, which was unchanged from the previous year. But a bright spot in 2012’s report was that home sales at more than $1 million were up 50 percent with 33 recorded compared to 22 in 2011.

Out of the county’s 34 ZIP codes, Collierville’s 38017 generated the most housing activity last year, with 961 sales averaging $288,753 and totaling $277.5 million. Eads’ 38028 had the highest average price, $431,509, with 39 sales.

Bank, or foreclosure, sales for the year were up 11 percent to 3,817 sales. Bank sales averaged $67,289 and totaled $257 million.

Bell-Warren said while bank sales are up, lenders are starting to look at short sales versus just going straight into the foreclosure process.

According to a recent article in The Wall Street Journal, prices are stabilizing in nonjudicial states like Tennessee that have streamlined foreclosure procedures. The rebound is strongest in states that allow lenders to enforce contracts.

The number of residential foreclosures in Shelby County was up 5 percent in 2012 compared to 2011 with 4,200 foreclosures, according to Chandler Reports. But the number of residential foreclosure notices was down 16.2 percent to 8,077 in 2012.

There were 7,976 loans issued at time of purchase last year, up 17 percent year over year. And the average loan amount at time of purchase was up 4 percent in 2012 to $154,240.

Conversely, nonbank, or traditional, sales were up 21 percent to 11,129. Nonbank sales averaged $143,239 and totaled $1.6 billion. As with overall sales, Collierville topped the nonbank category with 858.

Meanwhile, sales of new homes saw a 4 percent uptick year over year to 791, compared to 761 in 2011. Average pricing for new homes in 2012 saw a 16 percent increase to $255,693. Arlington’s 38002 led Shelby County in new home sales with 184 averaging $245,238.

On a national level, new home sales recorded their strongest pace in more than two years in November – another sign of life in the housing market.

Overall, 2013 appears to be another year of baby steps for the housing industry. The Federal Reserve predicts interest rates to remain low until 2015.

Bell-Warren hopes that forecast turns out to be true “so that we can keep these buyers buying and people being able to sell and get out of these upside-down mortgages.”

This year is also somewhat promising for first-time homebuyers to return to the marketplace. A year ago, unemployment among 25- to 34-year-old workers was 9.2 percent versus 8.7 percent for all adults, according to CNNMoney. But in November, unemployment among young workers had fallen to 7.9 percent versus 7.7 percent for all adults.

“I think that first-time homebuyers are the foundation of our real estate market,” Hubbard said. “The more people we get into that first home, the better the market becomes.”